ASX CIO gets busy on new technology rollouts

For CIO of the Australian Securities Exchange, Tim Thurman, every day is a busy day ensuring the technology that supports listings, trading, clearing and settlement activities runs smoothly.

CIO Australia caught up with Thurman to see what he is up to at the ASX.

Real-time risk margining system

Thurman plans to start looking for a new risk system to support real-time margining in June/July this year to compete globally with other exchanges that offer this.

“Australia is so far away from the rest of the world, so for us to attract order flow here is kind of challenging," the CIO said. "We want to go out and compete with other peer exchanges globally, more so in the region of Asia."

The system will be part of the ASX’s Collateral centralised management system, which leverages Clearstream’s technology.

“Phase one was collateral management on our futures platform. We are doing now collateral management combined with the cash equity… and that should be ready for production [mid-April] next year,” Thurman said.

He is also looking to make ASX’s trading platforms and clearing systems multi-currency. At the moment, it trades in Australian and New Zealand dollars.

Rationalisation of databases

The ASX is also undergoing a re-architecture of its back office, rationalising its 14 CRM databases down to one or two.

About seven months ago, Thurman started using Salesforce to create a centralised client database, and plans to extend its use in the organisation during the next fiscal year.

“It has taken off quite well in the Exchange, so we are going to start deploying it to more of a generic tool [for] incident management and so forth, taking advantage of some of the other services that Salesforce offers,” Thurman said.

Thurman is also rationalising three risk margining systems down to one. “By having one risk system, margining system, our clients can get more efficiencies across our different asset classes – derivatives, OTC and cash. Right now they are margined independently, which means they have to have more money in the clearing houses.”

By rationalising the ASX’s databases, Thurman hopes to bring all that data together so it can be packaged, then sold to clients.

“That’s on the side of everything else. The data piece of our business is what I call the 'crown jewel' because everything is going electronic. And that data going out facilitates trading coming in. The richer it is, the faster it is. We want our clients to do a lot more great stuff.”

Client-to-client OTC clearing

Thurman launched new software in April that allows Australian interest rate client clearing.

The software, provided by Calypso, allows for end-to-end over-the-counter (OTC) client clearing, risk management and connectivity between the ASX and investment banks.

In July last year, Thurman launched Calypso's dealer-to-dealer OTC clearing offer for Australian dollar-denominated interest rate swaps. He managed to deliver on the project in eight months using the Agile methodology.

“For me, the big thing is bringing those global standards to Australia that will allow our clients to utilise their software globally here. You know, UBS, JPMorgan – all those big global players. By us standardising our software, it will allow them to become more efficient and lower their total cost of ownership in Australia,” Thurman said.

ASX Trade24 platform

The ASX will replace the technology that underpins its ASX Trade24 platform, SYCOM, and will start carrying out due diligence for a new platform in the next few months.

“We’ve had very, very few problems with it; I think the availability is pushing 100 per cent on that platform. But my goal, being the CIO looking down at what I’ve got from a technology point of view, and what the board and my boss the CEO wants to accomplish, I know that platform will not cut it,” said Thurman.

“We are in the process now of looking at a few products and seeing what best fits us out of the box because Australia has some very unique trading behaviours in terms of functionality. So I want to make sure that when we get a product that it’s state-of-art, the best technology we can get, has usable language, the functionality is rich, and a vendor or a partner who can help me support it.”

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